wjr business beat

WJR Business Beat: Consumer Credit Card Spending Increasing (Episode 322)

On the Business Beat, Jeff Sloan discusses how increased consumer credit card usage may signal trouble ahead.

Tune in to the Business Beat, below, for details:


Tune in to News/Talk 760 AM WJR weekday mornings at 7:11 a.m. for the WJR Business Beat. Listeners outside of the Detroit area can listen live HERE.

Are you an entrepreneur with a great story to share? If so, contact us at [email protected] and we’ll feature you on an upcoming segment of the WJR Business Beat!

Good morning, Paul! The good news this morning, U.S. consumers are spending more and that’s great for retailers and other businesses who need that increased spend desperately. However, the concerning news? It now is clear that an increased amount of that spending is being driven by consumer credit card usage and the trend signals a market change from how consumers use their credit cards during the COVID-19 crisis when they actually scaled back spending and substantially paid down debt. Now, during the pandemic household supported by direct cash payments and forbearance programs largely reduce their credit card debt. But now with forbearance programs winding down, some of those consumers may be using some of their available credit to make ends meet. And this is driving those credit balances up. Now the Federal Reserve of New York’s Center for Microeconomic Data recently issued its quarterly report on household debt and credit. And the report shows the total household debt increased by $286 billion in the third quarter of 2021. The total debt balance now is $1.1 trillion higher than it was at the end of 2019 for U.S households. It is also $890 billion higher than Q3 2020. What does all of this mean? Well, it certainly appears as though credit card use is ramping up and it’s returning to pre-pandemic levels, the researcher said. As pandemic relief efforts wind down, we are beginning to see the reversal as some of the credit card balance trends seen during the pandemic, namely reduced consumption and paying down of balances, Dung Hoon Lee, a research officer at the New York Fed said in his statement. He went on to say at the same time, as pandemic restrictions are lifted and consumption normalizes, credit card usage and balances are resuming their pre-pandemic trends. Now all the findings showed that credit balances are increasing that delinquencies fortunately remained low, at least for now. Thanks in part to forbearance programs and other federal aid. Now is this a short-term increase in credit usage or is it a harbinger of tougher economic times confronting us now and even into the future? We’ll be keeping an eye on this, Paul, and we’ll continue to report on the trends as we get more information. I’m Jeff Sloan, founder and CEO of startupnation.com, and that’s today’s Business Beat on the Great Voice of the Great Lakes, WJR.

Previous Article

Simple Hacks to Enhance the SEO of Your Website

Next Article
buying an existing business

Why You Should Buy an Online Business Instead of Building One From Scratch

Related Posts
Read More

Ned Staebler of TechTown and Wayne State University on Challenges to Equitable Economic Growth

The president and CEO of TechTown Detroit and vice president for economic development at Wayne State University, Ned Staebler, talks with Jeff Sloan about the group’s pursuit of equitable growth, funding and access to opportunity for entrepreneurs. He shares success stories, but also explains the significant changes to communities that have to occur to draw...
Read More

Howard Handler of 313 Presents on the Business of Entertainment

Howard Handler, president of 313 Presents, talks with Jeff Sloan about live events in Detroit and how the pandemic forced venues to get creative. Learn why artists consider Detroit a go-to destination and how the area is poised for growth. And just wait until you hear where Howard’s career has taken him. Tune in below:...
Read More

WJR Business Beat: The Great Story Behind Better Made (Episode 407)

On today's Business Beat, Jeff Sloan and Paul W. Smith preview a new episode of Business Biography on Better Made Snack Foods, an example of the business diversity and entrepreneurial spirit in Detroit. Tune in to today’s Business Beat to learn what set Better Made apart from its competitors:     Tune in to News/Talk...